The five most wrongly claimed tax deductions
Here are the expenses Canadians try to claim that Canada Revenue Agency says are simply not eligible.
1. MOVING EXPENSES
Don't do this: Expenses like home staging, the cost of house hunting and job hunting trips, mail-forwarding charges, storage fees near your former residence, and the cost of repairing your old residence prior to selling it don't qualify.
In addition, the CRA says that sometimes receipts are either not sent in when requested or the receipts themselves are not valid, perhaps because the dates on the receipts don't correspond to the moving dates.
Do this: If you moved in 2014, you can write off your moving expenses provided the distance between your old residence and your new work location is at least 40 kilometres greater than the distance between your new residence and the new work location.
2. MEDICAL EXPENSES
Don't do this: Taxpayers often try to claim the costs of vitamins, natural supplements, or over-the-counter medications, which are not valid expenses. Similarly, medical supplies such as rubbing alcohol, bandages, and shoe inserts do not qualify for the credit.
Do this: Valid medical expenses qualify for a 15% federal credit as well as a provincial credit, provided they exceed a minimum threshold equal to the lesser of 3% of your net income or $2,171.
3. PUBLIC TRANSIT AMOUNT
Don't do this: The CRA says that in some cases, a copy of the transit pass was either not submitted when requested or the pass itself was not complete as it was missing the name or unique identifier or the information on the pass was not legible.
In other cases, the pass wasn't eligible because either there were not enough trips in a month, there were interruptions in use or travel for the period was limited.
Do this: You can claim the cost of monthly or annual public transit passes for travel within Canada on public transit, but these passes must permit unlimited travel on either local buses, streetcars, subways, commuter trains or buses, or even local ferries.
While you may also be able to claim the cost of shorter-duration passes, this only applies if each pass entitles you to unlimited travel for an uninterrupted period of at least five days and you purchase enough that you are entitled to unlimited travel for at least 20 days in any 28-day period.
In some cases, electronic payment cards also qualify, if the card is used to make at least 32 one-way trips during an uninterrupted period no longer than 31 days, provided you can get a receipt that proves both the cost and usage of the card.
4. INTEREST ON STUDENT LOANS
Don't do this: Sometimes students attempt to claim interest on personal loans and foreign student loans, both of which are ineligible. Sometimes the receipts are not official and don't bear the student's name.
Do this: Student loan interest is generally eligible for a tax credit but only for interest paid on a student loan made under the Canada Student Loans Act, the Canada Student Financial Assistance Act, or a similar provincial or territorial government law. You can't claim interest paid on any other kind of loan, like a financial institution's line of credit.
5. TUITION, EDUCATION AND TEXTBOOKS AMOUNTS
Don't do this: Sometimes claims for the tuition credit aren't supported by official receipts but rather invoices. In other cases, the educational institution is not a recognized institution. And, for purposes of claiming the education and textbook amounts, sometimes part-time months are claimed as full-time and vice versa.
Do this: While a non-refundable credit is available for the cost of tuition, be sure to have the official tuition receipt. The education amount is $400 for each month of full-time attendance and $120 for each month of part-time attendance. The textbook amount is $65 for each month of full-time attendance and $20 for each month of part-time attendance.